State Fines Fayette School Board Member Randy Hough $500,000 in First Liberty Ponzi Case

Fayette County Board of Education member Randall “Randy” Hough has been fined $500,000 and referred for possible criminal prosecution after state regulators concluded he helped sell millions of dollars in investments tied to the First Liberty Building and Loan Ponzi scheme.

Georgia Secretary of State Brad Raffensperger’s office issued an emergency order March 5 against Hough, a Peachtree City resident who has served on the FCBOE since 2021 and whose current term runs through 2028. Regulators allege Hough illegally sold unregistered securities, misled investors, and failed to disclose key financial risks while working as a development officer for First Liberty Building and Loan.

The order bars Hough from acting as a securities agent or investment adviser in Georgia and imposes a $500,000 civil penalty. State officials also referred the matter to the Griffin Judicial Circuit District Attorney’s Office for possible criminal prosecution.

“Many hardworking Georgians have suffered incredible financial losses, and we’re committed to pursuing accountability and swift justice,” Raffensperger said in a statement announcing the action.

Investors say they trusted him

Several investors told state investigators they trusted Hough because of personal relationships and his public role in the community.

One Fayette County special education teacher said she invested more than half of her life savings after discussing the opportunity with Hough, whom she described as both a family friend and a school board member.

The Secretary of State’s order states that Hough portrayed the investments as relatively safe while failing to provide sufficient information about the risks involved.

Another investor, a 71-year-old retired physician, reported investing about $800,000 across five First Liberty investments.

Only one of those investments returned his principal. According to his affidavit quoted in the order, the remaining investments failed, leaving roughly $550,000 unpaid.

How the First Liberty scheme worked

First Liberty marketed what it called “loan participation agreements,” investments promoted as short-term bridge loans to borrowers. Investors were told their money would fund those loans and generate interest when the loans were repaid.

But investigators concluded First Liberty frequently paid earlier investors using money from new investors rather than profits from successful loans. The Secretary of State’s order describes that structure as a defining characteristic of a Ponzi scheme.

The investigation began in 2025 after the Secretary of State’s office received more than 50 investor complaints related to the company.

Hough’s role at First Liberty

According to investigators, Hough joined First Liberty Building and Loan in August 2019 as an independent contractor and “development officer.” His role included bringing in investors and identifying potential borrowers.

Hough testified he acted as a “gatekeeper,” reviewing potential borrowers before referring them to the company’s underwriting team.

Regulators say Hough personally recruited eight investors and managed accounts for eleven investors, whose investments totaled about $6.9 million in First Liberty loan participation agreements.

Some investors told regulators they relied on Hough to recommend or select specific First Liberty investments on their behalf.

Personal financial benefit

Investigators concluded Hough personally profited from the sales.

Between 2019 and 2024, the Secretary of State’s office says Hough received roughly $168,875 in commissions tied to the investment products he sold.

Records cited in the order also show Hough received about $70,000 in bonuses from First Liberty during that period, as well as political contributions from First Liberty totaling $7,500 related to his Fayette County school board campaigns.

Bankruptcy and the CurePoint investment

One investment cited in the state’s order involved a borrower known as CurePoint.

According to investigators, First Liberty loaned money to CurePoint through its loan participation program. CurePoint later filed for bankruptcy, but regulators say Hough continued recommending the investment to potential investors without disclosing the bankruptcy filing.

The order states Hough continued encouraging investors to participate in First Liberty investments even as problems began to emerge with earlier deals. Investigators concluded he made material misrepresentations or omissions when selling the securities.

Unregistered securities and advisory activity

The Secretary of State’s office determined the loan participation agreements being sold were securities under Georgia law and should have been registered with the state.

Investigators concluded the securities were not registered, Hough was not registered as a securities agent, and he was not licensed to provide investment advice.

In one instance cited in the order, Hough continued charging a client for investment advisory services even after his registration as an adviser had ended.

Prior regulatory history

The Secretary of State’s order also notes that Hough previously faced disciplinary issues during his long career in the securities industry.

According to the order, Hough worked as a broker-dealer agent for various firms from 1983 until 2018. While employed by A.G. Edwards & Sons, Inc., regulators entered a consent order against the firm on April 7, 2004 related to failures to supervise employees involved in unauthorized trades and unsuitable investment recommendations. The firm agreed to pay a $500,000 civil penalty, the maximum allowed.

The order further states that Hough’s registration with A.G. Edwards ended July 30, 2003 after he “failed to cooperate in the firm’s investigation.”

Investigators emphasized that Hough’s decades of experience in the securities industry meant he had the background to understand the regulatory requirements and risks associated with the types of investment products later sold through First Liberty.

That experience, regulators said, meant he should have recognized warning signs surrounding the investments he was promoting.

Cease-and-desist order

The emergency order requires Hough to immediately stop violating Georgia securities laws.

It also bars him from acting as a securities agent or investment adviser representative in the state and imposes a $500,000 civil penalty payable to the Georgia Commissioner of Securities.

Hough has 30 days to request a hearing challenging the order.

Criminal referral

In a separate letter dated March 5, the Secretary of State’s Securities and Charities Division referred the case to the Griffin Judicial Circuit District Attorney’s Office for potential criminal prosecution.

The case will fall under the authority of Acting District Attorney David Studdard.

The Griffin Judicial Circuit includes Fayette, Pike, Spalding, and Upson counties.

It remains unclear whether Hough will resign from the Fayette County Board of Education in light of the state’s order. The school board could request his resignation, though it does not have the authority to remove an elected member.

The Fayette County School System is one of the county’s largest employers and operates one of its largest public budgets, making the board one of the most influential governing bodies in the community.

Under Georgia law, voters may also attempt a recall election, which would require petition signatures from 30% of registered voters in the district before a recall vote could be scheduled.

What happens next

The Secretary of State’s order is an administrative action, not a criminal conviction.

Hough has the right to request a hearing to challenge the findings.

Separately, the criminal referral means prosecutors will review the investigation and determine whether criminal charges should be filed.